7 Ways Phenomenal Entrepreneurs Respond to Business Crisis
Crisis Management, simply put is the process of dealing with situations or circumstances that have the potential of causing harm, is causing harm, or have caused harm. That’s a general definition.
A more specific definition for a business will take into cognizance the effect of the crisis situation on the income, reputation, and even morale of staff of the business.
Crisis can occur in a business at any time, in any place, and in any form. There are many things that can go wrong in a business – income-expenditure imbalance, a staff stealing from you, taxation issues, delay in payment by customers, product recall, just name it. Some of these lead to other crises also.
All these fall on you as an entrepreneur, and I’m sure you know that already. Your staff will not feel the heat as much as you do. You may lose money, time, good repute and sometimes self-esteem, in the event of a business crisis.
The saddest thing about crises is that they do not announce their arrival. Even when they do, most people do not hear about it because they were not listening.
Back in 2014 for instance, I was a fast moving consumer goods entrepreneur. I was having the time of my life. It was a purely brick and mortar business and I had different plans to expand and break new frontiers.
But on the 20th of November 2014, everything changed. My business premises caught fire and the structure was burnt. It happened at midnight, and it was rather devastating.
Some things were salvaged from the fire, but things never remained the same. Funny enough, the fire incident didn’t affect my sales so much. I still did my supplies and attended to a couple of walk-in customers. Few weeks later, I was back on my feet, ready to make maximum use of the Xmas seasonal sales.
Was it that the fire didn’t affect me? It did. But I knew a couple of things about handling crisis that helped me overcome and stand my ground.
If you have ever been in any form of business crisis then you will understand how important it is to know how to respond so that at least you don’t lose anything. If you haven’t however, you still need the knowledge, just in case.
Either way, these are ways that phenomenal entrepreneurs respond to business crisis. The points here are not just from my experience, but what I learnt from the experience of other successful entrepreneurs who have faced some down times, but refused to cave in.
So let’s jump right into the seven ways phenomenal entrepreneurs respond to business crisis:
They Plan For It
This is actually a pre-step. Crises are bound to happen, and how well you plan for it determines what happens during, and after the crisis period.
If you want to succeed in business, you have to make room for unplanned factors that can impede growth. Thing is, what is coming will come. You’ve got to get your business in order, to remain standing afterwards.
This is not saying you should expect evil or be pessimistic towards every action or decision. It is me telling you to examine thoroughly, all the possible outcomes from the decisions you are about to make, or the steps you are about to take. Or to put it another way, you should always look out for ‘worst possible outcome’, and
2. They Boost Staff’s Morale
In times of crisis, it is easy for you to want to focus on the customers or investors. While that is also good, you should not neglect your staff. After all they are the ones to carry out the operations to tackle the crisis.
You want to keep their morale high, inspire them, and motivate them. They will put in more when you do this, and it means quicker steps to solving the problem.
3. They Communicate to Relevant Stakeholders
For you, the first set of people should be your staff. I expect that you have a good relationship with them, otherwise this crisis is the least of your worries I tell you.
Your staff are the major people involved, chances are you got to know of the situation through one of them. You should speak to them, because the organization’s repute, income, and customer base is at stake. Now, for a bigger firm, there is no need to talk to everybody. You just need to talk to the people that will be directly involved in the decision-making plans.
Customers need to be reached out to too. Be sincere, and confident. You must assure everyone of your capacity to salvage the situation.
You can get a professional spokesperson, or designate a staff to perform the role for the time being. Nobody should speak to customers or the press, save that individual.
4. They Act With Force
You do not want the situation to remain or worse still, to become bigger. You are an entrepreneur; taking forceful action is not alien to you. Don’t sit around and wait for things to change and get better on their own. Take action immediately. Take the bull by the horn.
Place the calls, send the emails, go for lunch with that stakeholder, show customers that you are on top of the situation. Do whatever it is you have decisively planned out.
Knock the crisis out!
5. They Give Updates
Humans are emotional beings. Most people know that crises are many times inevitable, and since you have communicated to them from the beginning, you already have a “compassion capital” in their hearts.
Tell the people involved what is going on, what you are doing, and what you have achieved since the beginning of the crisis. You are showing them how capable you are of handling the situation, and how dear they are to your heart.
6. They Step Back, Analyze the Situation, Before they Act
It is normal that when we experience a situation that threatens our security, peace, balance, or prosperity, our programmed response will be to fight or flight. Our physiology says so. But if you want to make the best decision, you should wait a little to understand the situation.
I understand that sometimes, the crisis may require our swift response, but that does not take away the need for tact and wisdom in the decision making process.
Emergency officers, especially firemen do not just rush to a disaster scene and start trying to save lives and properties. They inspect the environment, and then decide what action is best to take. So should you.
7. They Effectively Use The Social Media
If this article was written as low as 15 years ago, this point would have been unnecessary; it would have destroyed the validity of the previous points even.
What do phenomenal businesses do with social media in crisis situations? They increase their response time. You can get a social media manager if need be. You also use social media for your communications.
Let the customers and stakeholders see that you are working.
In the end, you discover that you can turn a crisis into a goldmine if you follow these instructions to deal with the situation. People now see that you actually can do what you said you can do! You get new customers, and you strengthen the bond between you and old customers.
Have you experienced any form of business crisis before? What was the situation like? And how did you handle it?
Please share your experience in the comment section. And don’t forget to share this post.